Cars at auctions are typically pretty damn cheap. That happens because there is risk for the buyer when buying a car at auction.

If cars at police auctions were unnaturally cheap, everyone would be making a killing with arbitrage. (To be clear, many people do, but as more people get in on that, prices at police auctions go up... the balance that is struck gets you relatively close to the legitimate value of a car at a police auction).

Trust me, they love that money. They use it to buy fun new toys for themselves. That's when the property itself isn't their new toy: http://www.clumsycrooks.com/media/files18/pictures/drug_deal...